Mitsui Manufacturers Bank v. Unicom Computer Corp.

LEAVY, Circuit Judge:

In this appeal we are called upon to decide whether a debtor’s prepetition transfer to a creditor of money belonging to the creditor but mistakenly received by the debtor constitutes a voidable preference because the debt- or had temporary possession of the money within ninety days of the filing of its petition in bankruptcy. The Bankruptcy Appellate Panel (“BAP”) upheld the bankruptcy court’s ruling that, for purposes of bankruptcy law, the debtor’s prepetition transfer of the payment to its rightful owner constituted a voidable preference. We reverse.

FACTS AND PRIOR…